Penalty u/s 234e

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 June 2014 Whether penalty levied u/s 234E of the Income Tax Act,1961 can be waived????
If Yes how?
is there any case laws related to this ??
Kindly give reply as early as possible

Simranjeet Singh

Simranjeet Singh (Expert)
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04 June 2014 Penalty cannot be waived off in any case. But as per the judgement of Karnataka High Court the penalty imposed is in contrary to the provisions of Income Tax Act. But as per CBDT section 234E is in the nature of fee and not penalty. therefore it cannot be waived off

Nikhil Kaushik

Nikhil Kaushik (Expert)
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04 June 2014 Dear Simranjeet,

Has Karnataka High Court pronounced the judgment yet? Last I checked (today) the cases status is adjourned.

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CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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06 June 2014 still it is applicable and the judgement is pending.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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09 February 2015 Mumbai High Court rules - 234E fees constitutionally Valid

Rashmikant Kundalia vs. UOI (Bombay High Court)

S. 234E: The late filing of TDS returns by the deductor causes inconvenience to everyone and s. 234E levies a fee to regularize the said late filing. The fee is not in the guise of a tax nor is it onerous. The levy is constitutionally valid

The late submission of TDS statements means the Department is burdened with extra work which is otherwise not required if the TDS statements were furnished within the prescribed time. This fee is for the payment of the additional burden forced upon the Department. A person deducting the tax (the deductor), is allowed to file his TDS statement beyond the prescribed time provided he pays the fee as prescribed under section 234E of the Act. In other words, the late filing of the TDS return/statements is regularised upon payment of the fee as set out in section 234E. This is nothing but a privilege and a special service to the deductor allowing him to file the TDS return/statements beyond the time prescribed by the Act and/or the Rules. We therefore cannot agree with the argument of the Petitioners that the fee that is sought to be collected under section 234E of the Act is really nothing but a collection in the guise of a tax